SUMMARY Abnormalities of skin melanocytes (Mcs) can cause a number of skin pigmentation diseases including hyper/hypo skin pigmentation, as well as the most aggressive form of skin cancer, melanoma, that still lacks a cure. One of the major obstacles in developing effective treatments for melanoma as well as many other pigmentary disorders is our poor understanding of the organization and regulation of Mc stem cells (McSCs). Thus far, McSCs have been only identified in the hair follicle, and it is not known whether McSCs are present in the skin epidermis. Moreover, little is known about how McSCs are molecularly regulated. This is in stark contrast to epithelial stem cells whose identity and characterization have been key to interrogating this population and determining how epithelial stem cells are regulated during tissue regeneration as well as during carcinogenesis. During the last granting period, we made two important discoveries: First, we found that Wnt signaling regulates the self-renewal and differentiation of McSCs as well as their melanoma-transformation in an established melanoma mouse model. Second, we found that a subpopulation of Mcs in the epidermis also displays active Wnt signaling, and these epidermal Mcs persist for long-term within the epidermis. We hypothesize that Wnt-active epidermal Mcs represent a McSC population that maintains and regenerates Mcs in the skin epidermis and can transform into melanoma cells. We will test this hypothesis in three Specific Aims. Under Aim1, we will perform in vivo genetic lineage analysis under normal homeostasis and during Mc proliferation following UV exposure in parallel with ex vivo skin/hair reconstitution assays to determine whether Wnt-active epidermal Mcs self-renew and differentiate to durably maintain epidermal or hair Mcs. Under Aim 2, we will examine how Wnt signaling regulates the behavior of epidermal Mcs under normal homeostasis and following UV exposure. For this, we will perform Wnt loss- and gain-of-function experiments in Mcs employing established genetic mouse models. Under Aim3, we will test the ability of epidermal Mcs to form melanoma upon expression of melanoma-inducing mutations in a transplantation model. In summary, this study will be the first to definitively address the presence of McSCs within the skin epidermis and to begin to define how epidermal McSCs are regulated. Our findings will have a major impact in the field of Mc and melanoma biology. Newly identified McSCs within the skin epidermis and the Wnt pathway that regulates their behavior will provide novel targets for the prevention and treatment of melanoma as well as various pigmentation diseases.